Amazon Advertising For Sellers: Everything You Need To Know

Amazon Advertising For Sellers: Everything You Need To Know

Amazon adverts

“Many a small thing has been made large by the right kind of advertising.”

  • Mark Twain.

Digital advertising is a necessity for any Amazon seller trying to grow their business.

It’s how you position your products before your target audience, discover what they’re looking for, and convert them into customers.

And to make things simple for its sellers, Amazon has created its own advertising platform.

In this guide, we’ll teach everything you need to know about Amazon Advertising - the basics, your options within the platform, getting started, and more.

In this guide to advertising for Amazon sellers:

The best advice and insights for selling on Amazon this year

There’s a lot to know when it comes to selling on Amazon. In this guide, you’ll find expert tips and advice to make sure you start strong and stand out from the crowd.

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A Quick Rundown Of Digital Advertising For Ecommerce Stores

Before we dive into the details of Amazon advertising, let’s first take a look at online marketing in general.

NB: At the bottom of this guide, you’ll find a glossary of advertising terms. Refer to this if you’re ever unsure of a certain word or phrase.

What is digital advertising and why do you need it?

Digital advertising refers to any kind of ad that exists in an online space.

There are various mediums - videos, websites, audio platforms - along with various media formats - text, image, audio, video - that are available to sellers looking to grow their store.

Digital advertising can help to achieve multiple business goals, including (but not limited to):

  • Building brand awareness.
  • Increasing customer engagement.
  • Launching new products.
  • Driving repeat sales.
  • Learning more about your target audience.

Effectively, digital advertising is your ticket to more sales, better profit margins, and more informed marketing decisions.

Introducing Amazon Advertising

Amazon Ads has been around since 2012. And since it was founded, the platform has undergone many evolutions.

There have been a handful of name changes over the years, both for the platform itself and smaller elements within the platform. You don’t need to know all the different names right now, but it’s good to be aware that they exist.

Amazon advertising brands

Source: Omnitail.

Why should sellers consider using Amazon Ads?

The foremost benefit of Amazon Advertising is that you’ll get access to the most reliable source of Amazon buyer metrics available.

Additionally, Amazon (like Apple) is a company that seems to make it difficult to be a competitor. And since they sell just about anything, that is a problem for most ecommerce business owners.

For Amazon sellers, this is good news. It means that Amazon has put its efforts into building a comprehensive advertising platform of its own that practically eliminates the need for external options.

In short, Amazon Advertising provides an option for nearly all forms of advertising and makes it simple to manage and track all your efforts in one accessible place.

Preparing To Advertise On Amazon

Before diving headfirst into your Amazon advertising journey, it will pay to know a bit about the platform.

Prerequisites for advertising on Amazon

Before you start advertising on Amazon, you need to have a Professional seller account with Amazon.

To use Sponsored Display, Sponsored Brands, and Stores, you must also be enrolled in the Amazon Brand Registry.

Amazon advertising costs

One of the major advantages of running an Amazon Advertising campaign is that, for the most part, you can control exactly how much you spend on ads.

This is because many of the advertising options are charged on a CPC or CPM basis (see terms below), so you can set daily budgets that cannot be exceeded unless changed by you.

The costs per click or per-thousand impressions will vary depending on the ad type, the ad targeting type, your daily budget, and your bids per keyword.

And while there is no one-size-fits-all approach to advertising, Amazon specialist JungleScout recommends starting with a CPC budget of $50–$100 per day.

Setting up an Amazon Advertising account

To open an Amazon advertising account, log in to Seller Central and then visit the Amazon Advertising landing page.

Once there, select Start advertising.

Screenshot of Amazon signup page

You will be asked to select a campaign type. When you’ve done that, follow the steps to create your first campaign. If you would like to create a Store, select the Store tab and follow the steps to create your first page.

To create a Sponsored Brands ad, choose three or more products you wish to advertise, add a custom headline and logo, then choose the keywords you would like to target and your PPC bid. We’ll expand on what these are further down.

To create a Sponsored Products campaign, choose the products you wish to advertise, select either automatic or manual targeting, then set your PPC bid. We’ll expand on these below.

To start using Sponsored Display, choose your audience, set your daily budget and PPC bid, choose which products you wish to advertise, then create your campaign. We’ll learn more about these later on too.

Understanding the platform

Making the most of Amazon Advertising means getting a firm understanding of how the platform works before developing a campaign strategy.

Once you have sufficient knowledge, you’ll know where and how to focus your efforts for maximum efficiency.

The Amazon Advertising learning console is an online source of courses, certifications, and resources for Amazon advertisers. It allows advertisers to upskill and deepen their Amazon advertising knowledge at their own pace.

This is a great way to quickly understand the platform or acquire proof of your capabilities as an Amazon advertiser. There’s even a certification program for those who are particularly dedicated or want to demonstrate their skills.

Of course, the best way to understand the platform is to know what’s available. This next section will dive into the specific elements of Amazon Advertising one at a time.

But before we do, are your accounts ready for your foray into advertising?

Accounting for Amazon Ads

It’s estimated that almost half of all money spent on ads is wasted.

There’s no point funneling your resources into advertising if you can’t track how much return you’re getting.

Make sure before signing up to advertise on Amazon that you have A2X integrated with your account and accounting software.

For each Amazon payout, you’ll get a breakdown of exactly what income and expense lines went into that final sum, eliminating those painful hours of manual calculations.

Your Amazon accounting will be faster, more accurate, and reliable so that you can forecast with solid numbers and use them to invest ad spend more wisely.

Not only that, but you’ll have a more detailed summary of all the fees you paid Amazon, which, as you no doubt know by now, is a notoriously challenging part of accounting for the platform.

Try it for free today for breezy accounting, and prepare to sell and advertise with confidence.

Amazon Advertising Options For Sellers

Amazon advertising comes in many different shapes and sizes, and the ones that are right for your business will depend on your advertising budget, objectives, and target audience.

In this section, we’ll break down each of the different forms of Amazon ads, including how they work and what you can do to get the most out of them.

Amazon Stores

“Of customers who browse a brand’s Store once, 45% continue using Stores to shop on an ongoing basis.”

What they are:

Amazon Stores are multi-page, immersive shopping experiences within the Amazon marketplace. They present an opportunity to tell your brand story and display your products to browsing customers in a personalized way.

It’s free to open and run a Store on Amazon, so long as you already have a Professional seller’s account and have enrolled in the Amazon Brand Registry.

Stores are like an online catalog that can be built using templates and features to show your products in action and capture buyer interest.

You’ll receive your own branded URL and space on Amazon. Additionally, you’ll have access to useful metrics related to your store, to help you make more informed decisions around how to best serve your customers.

There are many benefits to operating an Amazon Store, as demonstrated in the infographic below.

Amazon stores

Source: Amazon.

How it works:

First, you must make sure that the products in your Store meet Amazon’s requirements for eligibility, as stated in their Stores ads policy.

To create your Store, log in to Seller Central or the advertising console then go to Stores > Manage Stores.

Your first step will be to add a brand name and logo.

After that, you will be asked to write a meta description for your homepage to help search engines define what your Store is all about.

*Pro tip: Include the main purpose of your Store and a call-to-action in your meta description to boost performance in search results.*

Next, choose a template for your store or design the whole thing from scratch. Using the creative guidelines set by Amazon, you’ll be able to customize your Amazon Store without learning any code - just drag and click.

You can then begin building subpages to group your products by category.

“On average, Stores with 3+ pages have 83% higher shopper dwell time and 32% higher attributed sales per visitor.”

Finally, use the tile manager to add content tiles (such as products) and widgets to your Store.

Once you’re happy with how your Store is looking, give it a final review and then submit your Store for publishing. If the Amazon team approves your store, it will go live within 24 hours.

Tips for getting the most out of Amazon Stores:

  • Create separate campaigns with different keyword strategies to gain insights into how each campaign performs. This will help you budget smarter and decide which product categories are worth promoting.
  • Make sure the above-the-fold section of your Store showcases the advantages of your products and brand.
  • Optimize your store for mobile to improve user experience. According to Amazon, 69% of all Store visits come from mobile devices.
  • Be as specific and relevant as possible with the keywords you are targeting to help attract the right type of customers (the ones that will click “Buy Now”).

Amazon sponsored products

“Adding A+ content to your detail page and advertising with Sponsored Products can help generate up to 93x more unit sales.”

What they are:

Sponsored products are automatically targeted ads generated from your current product listings. They appear in shopping results and on other product pages.

Sponsored product ads are shown to customers based on relevant keywords or products.

One of the biggest advantages of sponsored products is that they require no previous advertising experience - all the targeting is done on your behalf by Amazon.

Example of an ad on Amazon

Source: Amazon.

Your ads are charged per click (CPC), so you’ll only have to pay when somebody clicks on one. They can be created in a matter of minutes, and offer flexible targeting, bidding, and budgeting options for sellers.

How it works:

The first step for getting started with Sponsored products is to register for Amazon Ads. Only listings eligible for advertising may be considered for sponsored products.

Sign in to your Amazon advertising account and then select the Sponsored Products campaign type to begin.

If you’re just getting started, it’s recommended that you start with automated targeting. This allows Amazon to match your ad with keywords and products that align with the product you’re advertising.

For experienced advertisers, you can also opt for manual targeting. In this case, you’ll be able to pick and choose specific keywords and products based on your own knowledge and research.

“We like to always start with an automatic targeting campaign. It’s a really awesome tool for harvesting keywords. Then you can pull out those keywords that are in line with your goals, place them in manual targeting campaigns and optimize at the keyword level.”

To control your ad expenditure, simply decide on a daily budget and then set it.

If you’re using automatic targeting, you can set one default bid or set different bids for each targeting group. Amazon will provide bid suggestions based on recent winning bids for similar ads.

If you’re using manual targeting, you can set different bids for each keyword, product, and category.

Tips for getting the most out of sponsored products:

  • Monitor the results of your ads regularly to figure out what’s working. Increase ad spend on successful keywords and the testing of similar keywords.
  • Use negative keyword targeting to prevent your ads from being displayed in unwanted places. This will help you to exclude poorly performing searches and improve your return on ad spend (ROAS).
  • Use dynamic bidding to increase specificity (and therefore the likelihood of conversion) within your ads. Learn more about dynamic bidding and how to use it here.

Amazon sponsored brands

“Advertisers who launched Sponsored Brands after Sponsored Products saw a 12.2% average increase in the return on advertising spend.”

What they are:

Sponsored brands are customizable ads that feature your logo, a headline of your choice, and several products. Like sponsored products, these ads appear in shopping results and on product pages.

They work the same way as sponsored products, only instead of the goal being to sell a specific product, it mostly serves to increase brand awareness and attract customers to your entire range of products.

How it works:

Sign in to your Amazon Advertising account and then select the Sponsored Brands campaign type.

Screenshot of sponsored brands

Source: Amazon.

Name your campaign, select the dates you wish for it to start and end, then set your budget.

Just like sponsored products, you can select a daily budget for CPC that can be adjusted as you learn more from the success of your ads.

Select an ad format to use in your ad. Your options are:

  • Product collection.
  • Store spotlight.
  • Sponsored brands video.

Learn more about each option here.

Whichever ad format you choose you must then link to a landing page. This could be your Amazon store or a custom landing page of your choice.

“Linking your Sponsored Brands campaign to your Store page has 28% better return on your ad spend compared to linking to a product list page.”

Set up your ad creative (name, logo, headline, images, products), and then choose your targeting tactic. You have two options for targeting with sponsored brands: Keywords or Products.

It’s recommended that you use both targeting methods in your advertising strategy to maximize coverage and reach. However, it is only possible to use one targeting type per campaign.

Utilize bidding strategies and negative keywords just as you would with sponsored products, then submit for moderation review. If approved, your sponsored brands ad will go live shortly.

Top tips for getting the most out of sponsored brands:

“In our testing we found that on average, campaigns that used the taller Sponsored Brands ads on mobile saw a 13% increase in click-through rate, and ads on desktop saw an increase over 20%.”

  • Amazon.
  • For keyword targeting: Include at least 25 keywords and make sure you have a mix of match types; add negative keywords or products/brands to increase performance; use the search term report to identify what’s working.
  • For product targeting: Use individual product targeting for upselling, cross-selling, and to increase customer loyalty; use category targeting for increasing reach and awareness, and for targeting all products within a category.
  • Keep the copy in your headline concise and focused on the main benefits of your products. Be sure to include a clear call to action as well, e.g. “click on this / try this / buy now…”.
  • Test individual elements of your campaigns by cloning them and changing one variable at a time to see which version performs better.

Amazon sponsored display

“Display advertising has proven to be effective in driving product awareness, and engaging new and existing customers.”

What they are:

Sponsored display is a self-service form of advertising that serves to promote your entire product catalog using automatically-generated and autonomously optimized creatives (images/media).

The biggest benefit of sponsored display is that you can easily create and control an advertising campaign that incorporates your brand and all of your products with just a few clicks.

Sponsored display dynamically generates the creative elements of your ad. You can then add your own headline and brand logo to personalize the campaign and tell your brand story.

The ads can appear on the Amazon homepage, product pages, shopping results, and even on third-party websites or apps.

Sponsored display ad example

Source: Amazon.

It is currently available in the following Amazon marketplaces: United States, Canada, France, Germany, Italy, Spain, United Kingdom, India, Japan, and United Arab Emirates.

This Amazon advertising solution also offers many long-term benefits, such as synergy with sponsored ads and driven sales beyond the activation point. Studies have shown them to be particularly beneficial for small- and medium-sized businesses.

How it works:

To get started, log in to your Amazon advertising account and click Create a campaign then select Sponsored Display.

Name your campaign, set start and end dates, and decide a daily budget.

Next, create some ad groups. These are useful for organizing your products within each campaign, so you can use a different bid for each group to give you more control over specific elements of the campaign.

Sponsored display campaigns allow for two targeting tactics: Product and Audience.

Product targeting is ideal for targeting specific products or categories and can be further refined by price, rating, Prime shipping eligibility, and more.

Audience targeting is ideal for engaging or re-engaging with people that have already looked at your products, similar products to yours, relevant categories, and similar categories that your products are not currently featured in.

Choose which product you’d like to advertise and then define your bidding.

All that’s left to do is launch your campaign.

Amazon Ads will automatically generate the creative elements of your ad and update it if any changes are made to your product page.

Your campaigns can also display deals and savings badges which can help to increase CTR by up to 42%.

Top tips for getting the most out of sponsored display ads:

  • If your goal is brand loyalty, target your own products. If your goal is customer acquisition, target complementary products.
  • Use your headline to highlight the unique selling point of your product, and always round it off with a clear and compelling call to action (telling them what to do next).
  • Keep your ad design simple and mix up your size and contrast for more effective display ads.
  • Take advantage of custom bid optimizations to gain better control over your display ads.

“On average, advertisers who use multiple Sponsored Display targeting tactics have 3.2% higher sales than those using one single Sponsored Display targeting tactic.”

Audio ads

“Approximately 70% of total US smart speaker users [are] expected to use an Amazon Echo device [in 2021].”

What they are:

Audio ads are soundbites that are featured on Amazon Music’s free version.

They play during breaks in playback on Alexa-enabled devices such as Echo and Fire TV, and also on mobile or desktop. Ads can last anywhere between 10 and 30 seconds.

Companion banners are displayed on devices while your ad plays so that customers can click through to purchase a product.

Amazon audio ads are available for Amazon sellers and non-Amazon sellers wishing to advertise products on Amazon Music.

They are sold on a CPM (cost-per-thousand impressions) basis.

How it works:

To get set up with Audio ads, you must first contact an Amazon Ads account executive.

The account executive will guide you through the process and request that you provide your own audio file and companion banner. A typical minimum budget of USD 35,000 is also expected.

If all goes well, you can expect the ad to go live in as little as three days.

You’ll be able to track the success of your ads through reporting that includes impressions, average impression frequency, audio start, audio complete, cumulative campaign reach, and more.

Video ads

“Consumers continue to use video as an integral part of their journey with brands, and are excited to see even more video content in the year ahead.”

What they are:

Video ads, or Streaming TV ads, are short videos that play before or during Amazon streaming content. This includes IMBd TV, live sports, Twitch, Amazon Publisher Services broadcaster, and network apps, and the News app for Fire TV.

Amazon video ads are available for Amazon DSP users and non-Amazon sellers wishing to advertise products on Amazon streaming content.

Since non-pay-TV households are expected to outnumber pay-TV households in 2023, advertising on streaming platforms looks to be the future of television advertising.

Users with pay TV and non-pay TV graph

Source: eMarketer.

Video ads are also available as a form of Sponsored Brands advertising.

How it works:

To get set up with Video ads, you must first contact an Amazon Ads account executive.

Video ads must match specific criteria before being published.

Specs of digital ads

Source: Amazon.

For Amazon DSP users, you will also have access to the new Video Creative Builder tool to help you create your video ads.

Amazon DSP (demand-side platform)

“We used Amazon DSP to run display and video ads that helped maintain visibility on and off Amazon, post-launch. Amazon’s new creative options of GIFs, and videos, helped us in communicating functional features of G-Shock smartwatch, which helped customers find our brand store, and sales in the smartwatches segment on”

What it is:

Amazon DSP is a software system that provides centralized, automated media buying from multiple sources. You can purchase display, video, or audio ads through DSP.

Anyone wishing to use Amazon DSP has two options: Self-service or Managed service.

Self-service users take full control of their advertising campaigns, relying only on DSP for its automated media-buying functionality.

Managed service users will have access to Amazon DSP inventory with consultative service - ideal for those with limited programmatic advertising experience. This service typically requires at least USD 35,000 minimum spend.

Amazon DSP is available for Amazon and non-Amazon sellers. Unlike sponsored ads, people that click on your ads can be taken to locations outside of Amazon as well as inside.

You pay on a CPM (cost-per-thousand-impressions) basis.

How it works:

To get set up with Amazon DSP, you must first contact an Amazon Ads account executive.

There is also an online course available to help you familiarize yourself with Amazon DSP.

You can choose to create your own custom ads or use Amazon’s exclusive creative options and templates. You’ll be able to programmatically purchase your ads and run campaigns automatically.

Amazon DSP campaigns include free reporting where you can view all the industry-standard metrics, alongside Amazon proprietary metrics such as detail page view rate and new-to-brand metrics.

Additional advertising options

As well as the above options, there are a couple more ways to advertise with Amazon worth mentioning.

  1. Custom Advertising

Amazon’s Custom Advertising solutions are tailor-made ads for every stage of the marketing funnel. They are managed by the Amazon Custom Advertising team, which includes creatives, strategists, design technologists, and engineers. Think of them like your own mini agency.

  1. Off-site ads

Off-site advertising refers to any ads you’re running outside of the Amazon platform. These include Facebook ads, Youtube ads, sponsored ads, and more.

  1. Affiliate advertising

Affiliate advertising for Amazon sellers is managed through a platform called Amazon Associates. It is a way of getting people with large followings to promote your products on their websites, in exchange for a piece of the pie.

Amazon Advertising Mini-Glossary

The advertising world is full of niche terms and acronyms, particularly when diving into Amazon advertising.

Below are some common advertising-related phrases and their definitions to get you up to speed:

ACOSACOS, or advertising cost of sales, is a metric used to measure the performance of sponsored ad campaigns on Amazon. It reflects the ratio of ad spend to promoted product sales or overall brand sales and is calculated as spend divided by attributed sales.
AMGAMG is the acronym for Amazon Media Group - a team of Amazon employees that work alongside agencies and businesses to help them leverage Amazon ads more effectively.
AMSAMS stands for Amazon Marketing Services, the previous name for what is now called Sponsored Ads. It encompasses all of the in-Amazon advertising solutions the platform offers to its sellers.
ASINsASIN stands for Amazon Standard Identification Number - the unique combination of 10 letters/numbers assigned to every product listed on Amazon.
BudgetThe amount of money you set aside for your advertising campaigns.
CTRCTR stands for click-through rate and is determined by the percentage of ads that are clicked versus the percentage of ads that aren’t.
CPCCPC stands for cost-per-click, a form of paid advertising in which you only pay when a customer clicks on the ad (never for the impressions or display space). This is the cost method used for Amazon’s Sponsored Products and Sponsored Brands ad types.
CPMCPM stands for cost-per-thousand impressions (cost-per-mile), a form of paid advertising in which you pay for every 1000 impressions your ad does. This is the cost method used for Amazon DSP, audio ads, and video ad types.
DCODCO stands for dynamic creative optimization, a form of advertising technology that builds multiple versions of the same base creative while tailoring different elements of the ad based on audience, context, and past performance.
DSPDSP stands for demand-side platform, which is software used to programmatically purchase and manage digital advertising inventory. Amazon DSP was previously known as AAP (Amazon Advertising Platform).
Featured offersFeatured offers appear on a product detail page where the purchase process begins. Since multiple Amazon sellers can offer the same products, sellers can compete for theirs to become the “featured offer” and have a much better chance of winning the sale from other sellers.
ImpressionsThese are the number of times an ad is rendered on a device or page.
KeywordA keyword is a word or phrase that you can add to your Sponsored Products and Sponsored Brands ad campaigns. They’re matched with the search queries shoppers use to find products on Amazon and will determine where your ads appear.
Keyword bidA keyword bid is a cost you are willing to pay whenever someone clicks on your ad. If you set your keyword bid at $0.20, that is the maximum amount you will have to pay-per-click. However, if another seller sets a higher bid for the same keyword, their ad will receive better placement and be more likely to be seen by customers.
OTT adsOTT ads refer to over-the-top advertising, a form of video advertising also known as Streaming TV ads. They are advertisements that are delivered directly to viewers via streaming services over the internet.
PlacementThe place where your ad appears, such as in search results or on a product detail page.
ROASROAS, or return on ad spend, is a metric measured by how much money you spend on advertising compared to how much money that advertising yields.
ROIROI, or return on investment, is a metric measured by how much net profit you earn for every dollar you spend.

Also on the Blog

The best advice and insights for selling on Amazon this year

There’s a lot to know when it comes to selling on Amazon. In this guide, you’ll find expert tips and advice to make sure you start strong and stand out from the crowd.

Download our free guide
The Complete Guide to Selling on Amazon in 2022

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